Carbon-Free Bidding, SMR, LNG Cogeneration... What Does the 11th Electric Power Basic Plan Draft Contain?

Professor Jeong Dong-wook of Chung-Ang University is presenting the 11th Basic Plan for Electricity Supply and Demand (Electricity Plan) draft at the KFI Conference Center in Seoul on the 31st. Photo by Kang Hee-jong

The practical draft of the long-awaited 11th Basic Plan for Electricity Supply and Demand (Jeon-gi-bon) was finally unveiled on the 31st. The General Committee, an advisory body for the establishment of the Jeon-gi-bon, disclosed the practical draft at the FKI Conference Center on the same day. Based on this draft, the government will prepare a government proposal after the Ministry of Environment's strategic environmental and climate change impact assessment, followed by public hearings, reports to the National Assembly's standing committees, and deliberations by the Electricity Policy Deliberation Committee to finalize the 11th Jeon-gi-bon.

The planning period for the 11th Jeon-gi-bon spans from 2024 to 2038. The most anticipated aspect of the practical draft was how many additional nuclear power plants would be constructed during this period. However, upon review, several notable points beyond nuclear power stood out.

This Jeon-gi-bon reflects the expectation that electricity demand will surge due to artificial intelligence (AI) and electrification. It also recommends the introduction of a zero-carbon bidding market system for the first time and explicitly includes the adoption of Small Modular Reactors (SMRs). These are significant elements that could bring changes to the energy market. However, the expansion of LNG combined heat and power plants and the omission of coal-fired power plant phase-out may contradict the 2050 carbon neutrality goal, potentially sparking future controversy.

Introduction of the First Zero-Carbon Bidding Market

First, the General Committee assessed that up to three new nuclear power plants are necessary. It estimated that by 2026, unmet electricity demand would reach 4.4GW, which cannot be fulfilled by renewable energy, LNG combined heat and power, or hydrogen co-firing generation. This portion will be supplied by large nuclear power plants, considered the most economical among zero-carbon sources excluding renewables. This corresponds to the capacity to build three large nuclear power plants of 1.4GW each (based on APR1400 units).

Typically, large nuclear plants are constructed in pairs for operational efficiency. Nuclear plants have historically been planned and built in even numbers, such as Gori Units 3 and 4, Hanbit Units 3 and 4. Regarding the unusual figure of '3,' Professor Jeong Dong-wook of Chung-Ang University, who chaired the General Committee, explained, "This number emerged from a bottom-up approach. How to supply the 4.4GW capacity will be decided through consultations between the government and operators."

The practical draft predicts that 2.2GW of new facilities will be needed between 2035 and 2036. Of this, 0.7GW will be allocated for the commercialization demonstration of SMRs currently under research and development (R&D). The plan is to begin installing the first module in the second half of 2034 and sequentially incorporate a total of four modules.

Including SMR technology, which is still under development, in the 11th Jeon-gi-bon plan may be controversial. Professor Jeong stated, "SMRs received standard design approval in 2018 and are being developed based on pressurized water reactors, so technically, they are not difficult and are expected to be feasible." He added that even if the technology development is not completed within the period, the small scale of 0.7GW means the impact on supply and demand planning is minimal and manageable.

The practical draft also plans to introduce a zero-carbon bidding market to allow various zero-carbon power sources to compete and enter the electricity market for 1.5GW of the electricity needed between 2035 and 2036. Hydrogen combustion power generation was cited as an example of a possible zero-carbon source. This is the first time zero-carbon bidding is introduced in the Jeon-gi-bon.

Another notable point in this practical draft is the emphasized role of combined heat and power generation. The working group estimated that 10.6GW of new generation facilities would be required by 2028 to meet electricity demand. The problem is that there are no readily commercializable zero-carbon generation technologies at present.

New facilities of 2.5GW are needed between 2031 and 2032, and 1.5GW between 2033 and 2034, but zero-carbon technologies like SMRs and hydrogen combustion are expected to be commercialized only by the mid-2030s. Building new nuclear plants also takes more than 10 years.

The practical draft decided to meet the required electricity through LNG combined heat and power generation, which emits carbon but has high energy efficiency. Professor Jeong said, "Combined heat and power generation had little impact due to its small capacity, but recently, large-scale applications by operators have significantly influenced power supply and demand. We plan to clearly reflect the necessary capacity of combined heat and power generation in the Jeon-gi-bon to facilitate project approvals."

The practical draft plans to conduct pilot bidding for 1.1GW proposed in the 10th Jeon-gi-bon and select operators for additional volumes after supplementing necessary items following the finalization of the 11th Jeon-gi-bon.

For the 1.5GW needed between 2033 and 2034, the plan is to decide the power source in the next Jeon-gi-bon between 'hydrogen co-firing conditional combined heat and power' or 'zero-carbon' volumes.

Surging Demand Due to Semiconductors, AI, and Electrification

The 11th Jeon-gi-bon practical draft forecasts electricity demand of 129GW by 2038. Notably, it reflects for the first time the electricity demand from the semiconductor sector, where investment is expected to surge due to projects like the establishment of the Yongin Semiconductor National Industrial Complex. The electricity usage plan for semiconductor manufacturing companies was surveyed at 15.4GW by 2028.

Additionally, the rapid spread of AI is expected to significantly increase electricity demand from data centers, estimated at 4.4GW by 2038. Electrification across sectors such as industry, transportation, and hydrogen is projected to add 11GW of electricity demand by 2038.

The target installed capacity for 2038 was calculated at 157.8GW, considering a reserve margin of 22%.

Among this, solar and wind power facilities are expected to increase to 72GW by 2030. To achieve this, policy efforts such as improving setback distance regulations, activating solar power in industrial complexes, and early reinforcement of energy storage systems (ESS) are emphasized. The 72GW capacity is more than three times the 23GW installed in 2022. If the plan proceeds as intended, it will meet the goal of tripling renewable energy capacity agreed upon at the 28th United Nations (UN) Climate Change Conference of the Parties (COP28).

The renewable energy deployment forecast in this Jeon-gi-bon is an average of 6.6GW per year from 2024 to 2030. Considering the previous maximum achievement of 4.6GW in 2020, this is a very ambitious figure. The scale of solar and wind power facilities is expected to reach 115GW by 2038. The total new renewable energy capacity, including hydropower and biomass, is projected to increase to 123.5GW by 2038.

Regarding nuclear power plants, considering the completion of currently under-construction units such as Saeul Units 3 and 4, Shin-Hanul Units 3 and 4, and the continued operation of plants with expired licenses, the number of operating nuclear reactors is expected to increase from the current 26 to 30 units by 2038, with a total capacity of 31.6GW.

According to this plan, by 2030, the energy mix is expected to be 31.8% nuclear, 17.4% coal, 25.1% LNG, 21.6% renewables, 2.4% hydrogen and ammonia, and 1.7% others. The share of renewable energy generation remains the same as in the 10th plan, but the generation volume increased by 4.3 terawatt-hours (TWh). By 2038, the mix will shift to 35.8% nuclear, 10.3% coal, 11.1% LNG, 32.9% renewables, 5.5% hydrogen and ammonia, and 4.6% others.

"Power Grid Support is Essential"

Academic experts involved in the General Committee emphasized that policy and institutional support are necessary for these projections to materialize. Professor Jeong stressed, "The most critical factor determining the success of the power source plan is the expansion of the power grid," adding, "Active cooperation from the government, National Assembly, operators, and related local governments is essential to expand the power grid in a timely manner."

He also added that the Offshore Wind Power Special Act and the Special Act on High-Level Radioactive Waste Management, which were not passed and discarded in the 21st National Assembly, must be enacted in the 22nd National Assembly.

This content was produced with the assistance of AI translation services.